Head-To-Head Review: Paramount Global (NASDAQ:PARAA) & Nexstar Media Group (NASDAQ:NXST)

Paramount Global (NASDAQ:PARAAGet Rating) and Nexstar Media Group (NASDAQ:NXSTGet Rating) are both consumer discretionary companies, but which is the superior stock? We will contrast the two companies based on the strength of their analyst recommendations, risk, dividends, profitability, valuation, earnings and institutional ownership.

Risk and Volatility

Paramount Global has a beta of 1.49, meaning that its stock price is 49% more volatile than the S&P 500. Comparatively, Nexstar Media Group has a beta of 1.5, meaning that its stock price is 50% more volatile than the S&P 500.

Dividends

Paramount Global pays an annual dividend of 0.96 per share and has a dividend yield of 3.6%. Nexstar Media Group pays an annual dividend of $3.60 per share and has a dividend yield of 1.9%. Paramount Global pays out 15.7% of its earnings in the form of a dividend. Nexstar Media Group pays out 17.5% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Nexstar Media Group has increased its dividend for 9 consecutive years. Paramount Global is clearly the better dividend stock, given its higher yield and lower payout ratio.

Insider and Institutional Ownership

1.0% of Paramount Global shares are held by institutional investors. Comparatively, 96.0% of Nexstar Media Group shares are held by institutional investors. 1.7% of Paramount Global shares are held by company insiders. Comparatively, 5.0% of Nexstar Media Group shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Analyst Ratings

This is a breakdown of current recommendations for Paramount Global and Nexstar Media Group, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Paramount Global 0 0 0 0 N/A
Nexstar Media Group 0 0 4 0 3.00

Nexstar Media Group has a consensus target price of $210.57, indicating a potential upside of 11.79%. Given Nexstar Media Group’s higher probable upside, analysts clearly believe Nexstar Media Group is more favorable than Paramount Global.

Earnings and Valuation

This table compares Paramount Global and Nexstar Media Group’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Paramount Global $28.59 billion 0.61 $4.54 billion 6.11 4.43
Nexstar Media Group $4.65 billion 1.64 $834.57 million $20.59 9.15

Paramount Global has higher revenue and earnings than Nexstar Media Group. Paramount Global is trading at a lower price-to-earnings ratio than Nexstar Media Group, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Paramount Global and Nexstar Media Group’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Paramount Global 14.26% 7.90% 3.05%
Nexstar Media Group 18.66% 32.08% 6.69%

Summary

Nexstar Media Group beats Paramount Global on 12 of the 16 factors compared between the two stocks.

About Paramount Global

(Get Rating)

Paramount Global operates as a media and entertainment company worldwide. The company distributes a schedule of news and public affairs broadcasts, and sports and entertainment programming; acquires or develops, and schedules programming on the CBS Television Network that includes primetime comedies and dramas, reality, specials, kids' programs, daytime dramas, game shows, and late night programs; produces or distributes talk shows, court shows, game shows, and newsmagazines; owns and operates 29 broadcast television stations; and operates CBS Sports Network, a 24-hour cable channel that provides sports and related content, as well as streaming and cable subscription services. It also operates Paramount+, a digital subscription video on-demand and live streaming services; and creates and acquires programming for distribution and viewing on various media platforms, including subscription cable networks, subscription streaming, and premium and basic cable networks. In addition, the company develops, produces, finances, acquires, and distributes films. Paramount Global was formerly known as ViacomCBS Inc. and changed its name to Paramount Global in February 2022. The company was incorporated in 1986 and is headquartered in New York, New York. Paramount Global operates as a subsidiary of National Amusements, Inc.

About Nexstar Media Group

(Get Rating)

Nexstar Media Group, Inc., a television broadcasting and digital media company, focuses on the acquisition, development, and operation of television stations and interactive community websites and digital media services in the United States. The company offers free programming to television viewing audiences. As of December 31, 2020, it provided sales, programming, and other services through various local service agreements to 37 power television stations owned by independent third parties; and owned, operated, programmed, or provided sales and other services to 198 television stations. The company also offers video and display advertising platforms that are delivered locally or nationally through its own and various third party websites and mobile applications, as well as owns WGN America, a national general entertainment cable network. Its stations are affiliates of ABC, NBC, FOX, CBS, The CW, MyNetworkTV, and other broadcast television networks. The company was formerly known as Nexstar Broadcasting Group, Inc. and changed its name to Nexstar Media Group, Inc. in January 2017. Nexstar Media Group, Inc. was founded in 1996 and is headquartered in Irving, Texas.

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